There are internships that pay $11,000 a month. But you need a master’s degree in business administration.
For master’s of business administration students in two-year programmes around the world, the all-important summer internship isn’t just a potential segue to a full-time job. It’s also lucrative.
These positions are often the culmination of a long recruiting process that began last year with networking events, multiple rounds of interviews and heavy competition for spots at coveted firms.
And for good reason: Many of these jobs pay $7,000 a month or more, offer challenging work, and often translate into full-time job offers post-graduation. The median monthly base salary across all industries in 2014 was $8,000 at Wharton, $7,494 at Harvard and $6,800 at Stanford, according to employment reports from the schools. In management consulting, intern salaries can reach $11,000 a month.
Many companies will also cover travel costs and include a housing allowance to put towards accommodation if an intern needs to move from one country to another for the summer.
In the financial sector, few fields are more in demand among students than private equity, where candidates are chasing relatively few positions. Private equity “remains incredibly competitive to break into,” said Richard Bland, head of employer engagement at London Business School. “Generally, they’re looking for a set of specific skills and experience” including analytical abilities and prior deal experience.
Bland said private equity’s rise in popularity in part reflects students’ general preference for buy-side finance, where financiers execute transactions rather than just give advice. But private equity is also the “new cool thing,” he said, drawing in students by virtue of its popularity among other students.
Angela Guido, a Chicago-based founder of MBA Career Coaches, which consults with current and prospective MBA students, has clients who are unsure about what private equity is but are certain that’s what they want to do. “They’re sexy and interesting jobs, at least from the outside.”
One obvious draw is the earning potential. At Harvard Business School, for example, summer interns in private equity earned a monthly median base salary of $6,250 in 2014. Although that salary was lower than internships in investment banking or investment management, full-time hires in private equity earned higher salaries than in any other field – an annual median base salary of $150,000, with a median signing bonus and other guaranteed compensation totalling $100,000.
To be sure, investment banking and other financial services internships still garner plenty of interest from MBA students. But the financial crisis of 2008 cut the number of opportunities available for these graduates at banks while also diminishing the industry’s lustre in the eyes of students, Guido said. Nonetheless, she said banking remains a popular choice among MBAs.
Another industry drawing huge interest from MBAs is technology. At London Business School, traditionally known as a finance university, the recruiter that hired the third-most MBA students in 2014 was Amazon. Other technology firms such as Google and Facebook are also thought to be major employers of MBAs.
“Business schools used to be factories for banks and consulting firms,” said Seb Murray, news editor at BusinessBecause.com, a site focusing on business schools. As technological advances have disrupted the business world and new types of students pursue an MBA, “there’s been a bit of a culture shift where MBAs are looking for less traditional industries” including technology, Murray said.
At top business schools, median monthly salaries for technology internships ranged from $6,800 to $8,000 in 2014, while median annual salaries for full-time positions ranged from $115,000 to $120,000.
Guido said MBA students are increasingly interested in organisations that focus on social impact projects. As a result, internships with non-profits or foundations – where students can use their MBA skill set to support social enterprises or develop strategic approaches to tackling societal challenges – have become much more competitive. Other students target jobs with start-ups or launch their own entrepreneurial ventures.
Even as the MBA internship landscape shifts, one trend that hasn’t changed is the popularity of management consulting. The major consulting firms are among the top hiring firms at business schools, and these internships are in high demand among students, particularly for the big three of McKinsey & Company, the Boston Consulting Group and Bain & Company and other major consulting firms such as Accenture and Deloitte.
Consulting internships are generally the highest paying of any industry. At top business schools, the monthly median base salary for consulting internships was $11,000. And these internships often turn into full-time offers, which bring median annual salaries of $135,000, along with $50,000 in signing bonuses and other compensation.
Guido said consulting remains popular among MBA students year after year because it gives them broad exposure to a number of industries, keeping their options open for future employment opportunities if they decide to leave consulting.
“Most people know that they’re destined for true leadership, but they take a slightly more conservative approach to reaching that goal,” Guido said. “And for most people, that really is the right approach.”